Contributed article by Dr Sanjay Tolani, CEO, Goodwill World
Many expecting mothers lost their jobs in the past year, and along with it, they lost their right to medical insurance. With minimal scope to travel, many were forced to dip into their savings to deliver their babies in the UAE. The pandemic-stricken year that passed has been an eye-opener not just for businesses but for individual expecting mothers as well. It has brought about the need to plan personal finances, irrespective of how safe one’s current situation feels, especially for women.
Having travelled to more than 53 countries speaking and writing on personal finances, I realised there are some proven methods that expecting mothers can undertake to manage money stress in this uncertain world.
- Create a separate fund for the expenses you expect when you’re expecting
While it is true that one cannot precisely estimate the expenses, they might incur during their pregnancy, it is essential to reach a ballpark figure so that one can save towards it. Creating a separate fund for pregnancy and the baby’s initial years can prove to be a soft cushion that’ll alleviate expecting and new mothers from money stress considerably. In case something comes up that changes the finances of the household, like a pay cut or a job loss, this fund will come in handy. On the other hand, if all goes well, this fund will still ensure that one doesn’t have to dip into their monthly savings for maternity expenses.
- Start keeping money aside into an emergency fund
Everyone should consider doing this individually, as a couple, or as a family unit – keep money aside for at least 6 months of your total expenditure, including everything from household to personal expenses. Create an emergency fund that will take care of you and your family for at least 6 months in case something changes in your financial situation, like shifting jobs, pay cuts, moving to a different place, or taking a sabbatical. This will provide you with a safety net and help manage money stress when such a situation arises.
- Keep in mind that your company’s insurance policies are subject to change
You are not married to your company – the terms of your employment or the benefits you get because of it can change at any given point in time without your consultation. While it is great to have a sense of security from the organization you work for, it is not sensible to entirely depend on it. Corporate health insurance, for instance, may not be sufficient or available to you in a time of need. It is essential to build your safety nets like savings and insurance, outside of what a third party has created for you.
- Reduce your dependence on others for your financial safety nets
Women are especially susceptible to or often placed in situations where they are not in charge of their finances or financial plans for the future. It is crucial for individual women, especially expecting mothers and new mothers, to understand what plans and policies have been made in their name if any, and take control of them or change them as per their financial requirements. Getting additional insurance, for example, is an effective safety cover that women should consider. If no financial plans or covers have been invested in for you by your partner or family, invest in one for your and your child’s safety.
- Safeguarding yourself first to safeguard your child better, not the other way round
It is a proven fact that women live longer than men; they also spend and save more emotionally than others, especially mothers. For the safety of their baby, however, they need to understand that being older and more physically vulnerable, it makes more sense to safeguard themselves first. Love, fear, and greed (for their loved ones) often cloud the financial decisions women make. Making more practical money decision keeping these emotions under control can seriously improve one’s financial planning and, thus, money stress management.
So invest time writing down your money goals and start small savings today to give yourself a greater peace of mind. Remember, you do not need to be ready to start saving, all you need is to start today and be consistent with it.